Valdosta Company is working on its costing information for January. Using normal costing, they use one overhead control account and charges overhead to production at 75% of direct labor cost. The company does not formally close the account until the end of the year. The beginning and ending inventories for the month of August are August 1 August 31 Direct Materials $62,000 $67,000 Work in Process $171,000 $145,000 Finished Goods $78,000 $85,000 Production data for the month of August follows: Direct labor $250,000 Actual manufacturing overhead $195,500 Direct materials purchased $163,000 Transportation in $2,000 Valdosta Company's cost of goods transferred to finished goods inventory for August is Group of answer choices $484,000 $495,000 $577,000 $623,500
Process Costing
Process costing is a sort of operation costing which is employed to determine the value of a product at each process or stage of producing process, applicable where goods produced from a series of continuous operations or procedure.
Job Costing
Job costing is adhesive costs of each and every job involved in the production processes. It is an accounting measure. It is a method which determines the cost of specific jobs, which are performed according to the consumer’s specifications. Job costing is possible only in businesses where the production is done as per the customer’s requirement. For example, some customers order to manufacture furniture as per their needs.
ABC Costing
Cost Accounting is a form of managerial accounting that helps the company in assessing the total variable cost so as to compute the cost of production. Cost accounting is generally used by the management so as to ensure better decision-making. In comparison to financial accounting, cost accounting has to follow a set standard ad can be used flexibly by the management as per their needs. The types of Cost Accounting include – Lean Accounting, Standard Costing, Marginal Costing and Activity Based Costing.
Valdosta Company is working on its costing information for January. Using normal costing, they use one
The beginning and ending inventories for the month of August are
| August 1 | August 31 | |
| Direct Materials | $62,000 | $67,000 |
| Work in Process | $171,000 | $145,000 |
| Finished Goods | $78,000 | $85,000 |
Production data for the month of August follows:
| Direct labor | $250,000 |
| Actual manufacturing overhead | $195,500 |
| Direct materials purchased | $163,000 |
| Transportation in | $2,000 |
Valdosta Company's cost of goods transferred to finished goods inventory for August is
Production processes involve multiple processing phases. Different expenses will be associated with each phase. These costs can be passed along the production line. Costs that are incurred within a corporation as expenses, migrate from one department to another are known as transferred-in costs.
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